6 Benefits of affiliate marketing for small business in India

Apr 05, 2024

The rise of affiliate marketing

The way businesses market their products is constantly evolving over time thanks to the introduction of technology and the emergence of new distribution channels.

One such method that is becoming more and more popular by the day is known as ‘affiliate marketing.’ There are many benefits of affiliate marketing that small companies can leverage to grow their business.

What is affiliate marketing?

Affiliate marketing refers to an online seller of products or services paying a commission to an external entity (known as the affiliate) for bringing traffic or generating sales for your products or services. 


It is a performance-based marketing method that is on the rise with many niche influencers, creators, bloggers, publications, etc. who can monetize the influence they have over the audience they have built. 


Affiliate marketing for a small business is definitely a fruitful path as it exposes them to newer target audiences. 

How does affiliate marketing work?

There are usually two to three stakeholders involved in any affiliate marketing program. They include a merchant, an affiliate, and sometimes an affiliate network.


In the affiliate marketing model, a merchant refers to the businesses that are paying a commission to the publishers of an affiliate link of their products or services to bring traffic or generate sales.

The merchant is usually the one who sets up the affiliate program and the rules that apply.


An affiliate is an individual or entity promoting a merchant’s product or service and then using an affiliate link to drive traffic or sales.

The affiliate can be anyone who has officially joined a merchant’s affiliate marketing program and uses their respective affiliate link to promote the goods or services.

Affiliate network

A network that connects brands/businesses with an affiliate program to publishers is known as an affiliate network.

The network acts as a middleman and can basically be considered as a platform for affiliate marketers to find relevant brands and vice versa. The network makes it extremely easy for merchants and affiliates to connect and conduct business.

Affiliate marketing scope in India

Growing market over the last 5 years - India is constantly evolving and each day more of our population is getting access to the internet with smartphones. This boom will show a rise in consumerism leading to the success of affiliate marketing and also giving rise to more affiliate marketers and programs from companies.


$7bn spends through affiliate channels - Affiliate channels have shown a significant increase in the amount they spend signaling that they might be seeing a lot of success making them want to invest further in affiliate marketing.


14% market share in e-commerce - Affiliate marketing is a great channel for e-commerce businesses and publishers who specialize in a specific niche that can promote their products. 

6 benefits of affiliate marketing for small business

1. Creates a new sales channel that is profitable

An affiliate marketer for your product at the end of the day is another form of a sales channel. The best part is you don’t have to pay them anything beforehand. They get paid for their performance.

So it’s a win-win situation for everyone involved. Instead of trial and error advertising, you get profitable returns from the get-go.

2. Exposure to more people

A major benefit for brands who have created an affiliate channel is the ability to reach new and more people without having to spend money on advertising. Instead, they leverage the affiliate’s audience which brings in more eyeballs to your business.

3. Increases competitive advantage

Affiliates will choose a product or service to promote only when they truly believe in its worth. This means that if your product or service holds up to its promise and utility, you can be sure that all the affiliates would be promoting your products instead of your competitors.

4. Leverage affiliate’s credibility

One of the biggest benefits of affiliate marketing is that when an affiliate promotes your product or service to their audience, people are much more likely to try it out and convert into your customers.

This is because affiliate marketers work hard to build trust and credibility with their audience, else they will not be able to monetize them eventually. 

5. Performance-based advertising

Unlike other forms of paid marketing that don’t guarantee results, affiliate marketing is based solely on performance. So every commission you pay, you know your brand got what it is paying for. 

6. Tried and tested method

The affiliate marketing model of promoting goods and services has been proven time and time again across the world by many brands and individuals who know how to do it right. 

Costs associated with affiliate marketing

Network fees

If you choose to use an affiliate marketing network to find affiliates for your business, you might have to pay a small fee to the network based on their business model.

Resources for marketing

Certain digital infrastructure is needed in order to build and accurately track the metrics of an affiliate program. There are different tools and platforms available in the market that can help you do that.

Costs of managing the program

The cost of managing an affiliate program is not too high. It is only the initial setup that you would require some thinking and budget allocation to spread the word about your program and make it easily accessible to affiliates.

Affiliate commissions

Affiliate programs pay the affiliates in the form of a commission for the amount of traffic they bring or the sales they generate. The percentage these commissions need to be should be thought out strategically so that you don’t end up paying too much resulting in thin profit margins.

How to start affiliate marketing for small businesses?

1. Set realistic goals for the program

Start off small and set a simple affiliate marketing program that is easy for you and the affiliates to execute and track.

2. Choose affiliates that meet your target audience

Always partner with relevant affiliates whose audience matches the buyer personas of your business.

3. Create T&C for the program

Ensure that all the terms and conditions of the program are clear to the affiliate before starting the partnership.

4. Build an affiliate network

Join an existing affiliate network or create your own to always have someone ready to promote your products through affiliate marketing.

5. Choose the right commission structure

Make sure that the commission structure you have created makes business sense but also incentivizes the affiliates to want to promote your products.

6. Track affiliate sales

Ensure that there is a proper way to track traffic or sales that your affiliate partners are bringing in.

Future of affiliate marketing in India

The future of affiliate marketing in India will be very bright as more and more businesses and publishers become aware of this model of marketing.

We already see the trend going upward with creators, influencers, and publishers using affiliate links in their content to promote different brands and their products.


How much commission should we pay publishers?

The commission to be paid to an affiliate for bringing in traffic or sales completely depends on the way you structure your program and the industry you deal in. Make sure to keep the commissions compelling enough for affiliates while still ensuring profitability for the business.

How to track publisher sales activity?

There are many affiliate marketing tools available in the market that take care of tracking such as EverFlow, LinkTrst, AffTrack, etc. Other than these, you can also use google analytics and build UTM parameters with the help of a digital marketer to set up these tracking systems if the backend of the affiliate program is on your website domain itself.

Can we run multiple affiliate programs in other countries?

There aren’t any laws restricting a company from creating more than one affiliate program based on the country of operations, so yes, you can create multiple affiliate programs.

Automate and manage online payments and ad spends of your business